The process of Legally Closing a Corporation in Tennessee is called Dissolution.  After a Tennessee Corporation has been Dissolved, it ceases to be Legally Active in the Tennessee Secretary of State's records and may no longer Legally conduct business in the state of Tennessee.

A Tennessee Corporation is created when the TN Secretary of State approves the Formation Documents - Articles of Incorporation.  A record of the Tennessee Corporation is added to the list of Corporations which have officially registered with the Tennessee Secretary of State.  Once a Corporation is registered with the Tennessee Secretary of State, that Corporation immediately has both reporting and tax obligations which incur penalties if the obligations are not met by the required deadlines.

If you've registered a Tennessee Corporation with the Tennessee Secretary of State and want to cease business activities you have to let the TN Secretary of State know that you intend to close your company.  Only after the TN Secretary of State has made sure that all of the obligations of the Tennessee Corporation have been fulfilled will the Secretary of State approve of the closure of the company.

When the Tennessee Secretary of State approves the closing of a TN Corporation, that Tennessee Corporation is said to be Dissolved.  The process of Dissolving a Tennessee Corporation is called Tennessee Corporation Dissolution.

The Tennessee Secretary of State will not approve Dissolution of a Tennessee Corporation if the TN Corporation has not paid all taxes and discharged all debt obligations.

As soon as a Tennessee Corporation is registered with the TN Secretary of State, that Corporation is responsible for recurring obligations of the Tennessee Secretary of State and the Tennessee Department of Revenue.  If a Tennessee Corporation does not file its required reports or pay its tax obligations, then that TN Corporation could be responsible for penalties which compound as time goes by.

Unless you Dissolve (Legally Close) your Tennessee Corporation with the Tennessee Secretary of State that TN Corporation will be responsible for all recurring fees and penalties until the company has been legally closed.

Tennessee Corporation Dissolution is one part of a larger process commonly called the "Winding Up" process.

There are things you need to do before you can request approval of Corporation Dissolution from the Tennessee Secretary of State; and things that you have to do after the TN Secretary of State has approved Dissolution of the Tennessee Corporation. 

When a Tennessee Corporation is originally created, the Organizers may create Bylaws that define how the Corporation will be run.  The Bylaws may include pretty much anything that has to do with running the Corporation, including specific requirements which need to be followed before the Corporation may be Legally Closed.  Before you do anything else, you should review the Bylaws for anything that needs to be done before the Business is Legally Closed.

What you have to do both before and after the Tennessee Corporation is Dissolved largely depends on how much stock, if any, has been issued and how much and what kind of debts and liabilities that the Tennessee Corporation has.  If the Tennessee Corporation has not commenced business then the TN Corporation Dissolution process is easier.

1. Hold a Board of Directors meeting and record a resolution to Dissolve the Tennessee Corporation
   
   If a Board of Directors has been appointed for the Tennessee Corporation, then the Board is required to adopt a resolution to Dissolve the TN Corporation.  There should be a majority of Board Members who vote Yes to Legally Close the company.  A formal date on which the Corporation will be closed should be specified.  Minutes of the meeting should be recorded and retained in the business records.  If the Board of Directors has not been appointed then the Incorporator(s) have to apply for Dissolution of the Tennessee Corporation.
   
   We can transcribe and compile any minutes or approvals into a form that is legally recognized by the Tennessee Secretary of State.
   
   
2. Hold a Shareholder meeting to approve Dissolution of the Tennessee Corporation
   
   If a Tennessee Corporation has issued shares of stock then a meeting of the Shareholders (owners) must be held and recorded. A majority of Corporate Shareholders must approve the Dissolution plan.  The approval actions should be documented and kept in the business records.
   
   If no shares have been issued then the Tennessee Corporation Dissolution process is easier.
   
   
3. File a Written Consent to Dissolution with the TN Secretary of State
   
   The Written Consent to Dissolution must be filed with the Tennessee Secretary of State before initiating the final stages of the Tennessee Corporation Dissolution process.
   
   We can prepare your Written Consent to Dissolution and file it with the TN Secretary of State.
   
   
4. File all required Annual Reports with the Tennessee Secretary of State
   
   The Tennessee Secretary of State will not approve the Dissolution of a TN Corporation until all required administrative reports have been filed.
   
   We can file any required Annual Reports with the TN Secretary of State.
   
   
5. Clear up any business debts
   
   All creditors of a Tennessee Corporation should be given notice of the pending Corporation Dissolution. Each creditor should be given a mailing address to which they may submit claims as well as a deadline by which claims may be submitted.
   
   While the Tennessee Secretary of State does not legally require the publication of a Notice of Dissolution of a Tennessee Corporation, publication is a good way to notify anyone who might have a claim against the Tennessee Corporation.  Evidence of publication might prove useful down the line if someone makes a claim against the TN Corporation after the Tennessee Corporation has been dissolved.
   
   
6. Pay all taxes and administrative fees owed by the Tennessee Corporation
   
   The Tennessee Secretary of State will definitely not approve the Dissolution of a Tennessee Corporation until all outstanding taxes and applicable registration and administrative fees have been paid.

1. Distribute all remaining assets of the Tennessee Corporation
   
   If the Tennessee Corporation has any remaining assets, these may be divided according to the Shareholders' ownership interests in the TN Corporation. All distributions to Corporate Shareholders must be reported to the IRS.  Refer to the Corporation Bylaws for specific requirements, if any, for asset distribution.
   
   
2. Close all business bank accounts of the Tennessee Corporation
   
   If there are any business accounts that have been opened for the Tennessee Corporation then those accounts must be closed.  If any Corporate business accounts are left open there may be liability and obligations of the Dissolved Tennessee Corporation which could lead to legal problems.
   
   
3. Cancel all local business licenses and permits of the TN Corporation
   
   If the Tennessee Corporation has obtained any state, regional, county or city business licenses or permits, there may be cancellation requirements associated with those licenses or permits.  Each of those must be cancelled to avoid any reporting or fiscal obligations the Tennessee Corporation may have.  This includes business registration licenses as well as reseller permits.
   
   
4. File IRS Form 966
   
   A Dissolved Tennessee Corporations may be required to file IRS Form 966 with the US Internal Revenue Service.  This filing is required within 30 days after the final Dissolution plan is approved.  Filing IRS Form 966 lets the Federal Government know that the Tennessee Corporation has been legally Dissolved so that it may take the appropriate actions.
   
   
   We can prepare IRS Form 966 for you to file.
   
   
5. Cancel the IRS account associated with the TN Corporation's Federal Tax ID (EIN)
   
   A Federal Tax ID, or Federal Employer Identification Number (EIN), is like a Social Security Number for the Tennessee Corporation.  Once the IRS links an EIN to a Tennessee Corporation, that EIN stays with the Tennessee Corporation even after the Company has been Dissolved by the Tennessee Secretary of State.
   
   When the IRS processes the final tax return for the Tennessee Corporation, they automatically make the EIN inactive.  However, the account associated with the EIN is not automatically closed.  Closing the account associated with the EIN lessens the likelihood of any problems with the EIN account, or with the IRS, in the future.
   
   If you should decide to revive the Tennessee Corporation down the line the IRS will reactivate the old EIN for your new Business.
   
   Before a Tennessee Corporation can close an EIN account, it must be in Good Standing with the IRS.  The Tennessee Corporation must have filed all required tax returns and paid any applicable fees and penalties due to the IRS.  The Tennessee Corporation cannot close its EIN account until the IRS has received payment for any tax amounts the Company may owe.
   
   
   We can prepare the formal documents which you can sign and submit to the IRS in order to close the account associated with your EIN.
   
   
6. Keep Records of all Pertinent Business Documents
   
   In order to avoid problems down the line, you should keep copies of all tax filings, contracts and employment records on file as well as Certified Copies of all company documents filed with the Secretary of State.  This includes your Formation Documents - your original Articles of Incorporation and any Amendments - and all Dissolution douments.

You notify the IRS that your Tennessee Corporation has been Closed on the final tax return that is filed for your Business. 

If you have employees and file taxes quarterly with IRS Form 941, Employers Quarterly Tax Return, check the appropriate box on that form to let the IRS know that your Corporation has Closed.  If you file yearly taxes do the same on IRS Form 944, Employers Yearly Tax Return. You should also attach a statement to the return showing the name of the person keeping the payroll records and the address where those records will be retained.

When you opened your Tennessee Corporation you most likely were assigned a Federal Employer Identification Number (EIN).  Once the IRS links an EIN to a Corporation, that EIN stays with the Corporation even after the Company has been Dissolved.  If you don't plan to reopen your Tennessee Corporation after it has been Closed, you should cancel the EIN account that has been assigned to your Company.

The time it takes to Dissolve a Tennessee Corporation varies depending on how long it takes to complete the actions that are required in each specific case - holding meetings, closing accounts, distributing assets, etc.

Once the initial actions are completed, the Tennessee Secretary of State usually takes around 3-5 business days to process the Articles of Dissolution.

Processing times for Tennessee Corporation Dissolution filings vary depending on the work load of the Secretary of State's staff.  We've found that normal processing of Tennessee Dissolution filings takes the state around 3-5 business days.
We are dependent on, and have no control over, the staff and systems of the Tennessee Secretary of State . In our experience 3-5 business days is the time it usually takes the Tennessee Secretary of State to process a Tennessee Dissolution filing. We get your Tennessee Corporation Dissolution filing to the TN Secretary of State as soon as possible after we receive your order. Once it is at the state we have no control over the Tennessee Dissolution approval process.

The total cost to Dissolve a Tennessee Corporation varies depending on exactly what is required for each specific TN Dissolution.  We charge $249 plus any state fees for our Tennessee Corporation Dissolution services.

We also offer these Tennessee Corporation Dissolution services separately.

If there are Foreign Corporations in states other than Tennessee that are tied to the Domestic Tennessee Corporation then each of those Foreign Corporations must be Dissolved before the Tennessee Corporation can be legally Dissolved.

A Tennessee Corporation may revoke Dissolution any time before the TN Corporation files Articles of Termination by filing Articles of Revocation of Dissolution with the Tennessee Secretary of State.

A TN Corporation company name becomes available for anyone to use when the Tennessee Corporation is Dissolved by the Tennessee Secretary of State. There are no Corporation company name protections in Tennessee once a Tennessee Corporation has been Dissolved by the TN Secretary of State.